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Partnership and cooperation
Nevertheless, objective interests in mutual cooper-
ation prevail. As early as November 1992 Tashkent 
and Tehran signed a joint statement on cooperation 
in economic, cultural, transport, and communication 
sectors, which was later supported by a number of 
other agreements which laid the basis for the devel-
opment of bilateral relations.
Events post-2001 demonstrated the need to 
boost bilateral relations and take urgent decisions 
to address Central Asian transport and communica-
tion problems. In 2002, an agreement was reached on 
non-interference in the internal or external affairs of 
either country, and the need was stressed to build a 
policy based primarily on national interests. A stra-
tegic partnership between Russia and Uzbekistan 
had been also an incentive to consolidate bilateral 
relations, which to some extent lay in the interests of 
Tehran which views cooperation with Russia as a po-
tential counterweight to U.S. policy in Central Asia. 
Indeed, Iranian experts believe that it is only with 
the assistance of Moscow that Uzbekistan can solve 
the problems of armed aggression on its borders.
11
 
Of further importance to bilateral relations was an 
agreement signed in summer 2003 in Tehran on the 
creation of the Trans-Afghan corridor with the par-
ticipation of Afghanistan.
Despite, growing geopolitical instability in 
the Central Asian region, partly due to continued 
Iranian-American antagonism,
12
 Uzbekistan worked 
to improve its trade relations with Tehran in the mid-
2000s. Deepening relations have been supported 
by the number of signed contracts between the two 
countries: by January 2005 about 20 agreements had 
been signed, while by 2011 there were more than 
30 intergovernmental and interagency documents 
setting out basic principles and directions for the 
development of mutually beneficial economic and 
trade relations. In particular, relations between the 
countries are governed by the agreements “On trade 
and economic cooperation,” “On promotion and re-
ciprocal protection of investments,” “On avoidance of 
double taxation and exchange of information on in-
come and capital taxes,” as well as a number of inter-
9 “Statistical Yearbook for Asia and the Pacific,” United Nations, 2003.
10 “Posol Irana v Uzbekistane rasskazal ob otnosheniyakh dvukh stran,” Anons.uz, February 11, 2013, http://www.anons.uz/ article/politics/8549/.
11 S. Khabibulla Abu Khasan, “Mery bezopasnosti v Tsentral’noy Azii i na Kavkaze,” Amu-Darya 6 (2000): 45.
12 G. I. Yuldasheva, Irano-amerikanskie otnosheniya na sovremennom etape i ikh vozdeystvie na geopoliticheskuyu situatsiyu v Tsentral’noi Azii 
(Tashkent: Academy of Science of Uzbekistan, 2006).

Guli Yuldasheva
160
governmental memoranda. Currently there are over 
120 joint Iranian-Uzbek companies in Uzbekistan, 
20 of which are established with one hundred per-
cent Iranian capital. The priority areas of cooperation 
include transport communications, energy, textiles, 
and agriculture.
Beyond the economic sphere, Iran and 
Uzbekistan continue to actively cooperate in the 
field of security: namely, combating drug traffick-
ing and organized crime
13
 and participating in the 
activities of international organizations—includ-
ing the Organization for Economic Cooperation 
(OEC), Shanghai Cooperation Organization (SCO), 
Conference on Interaction and Confidence Building 
Measures in Asia (CICA), as well as all regional ini-
tiatives on Afghanistan which include the grouping 
“6+2,” “Delhi Policy group,” the Istanbul Summit, 
“Afghanistan and Central Asia” dialogue, among 
others.
current Situation
Currently, the development of Iranian-Uzbek rela-
tions continues to be largely affected by geopolitical 
checks and balances as well as interstate confronta-
tion.
The focus is now on how the situation in 
Afghanistan will evolve after the drawdown of NATO 
troops in 2014. Allied to this, moreover, there are sev-
eral conflicting visions of geopolitical development 
in the Central Asian region: the Eurasian model un-
der the auspices of Russia, the American “New Silk 
Road” model, and the pan-Asian or “Heart of Asia” 
model. It is obvious that each of these political proj-
ects cannot be realized without engaging Iran, which 
is capable of assisting or blocking the development 
of such projects on account of its special links with 
Central Asia, including Afghanistan and its large 
Shiite diaspora.
In light of the above and given the fact that many 
countries are seeking economic partnership with Iran, 
and support Tehran’s involvement in certain conflicts 
in the Middle East and Afghanistan, Washington is 
trying to enlist Tehran’s support or at least ensure its 
neutrality when addressing regional problems. In re-
sponse, Iran’s policy has been steadfastly cautious and 
ambiguous. On the one hand, because of the continu-
ing dispute with the United States, Tehran has been 
actively involved in various regional associations 
(SCO, Non-Aligned Movement, OIC, “Heart of Asia” 
for Afghanistan etc.) that seek to exclude U.S. pres-
sure and interests; on the other hand, Iran continues
with some success, to negotiate with the international 
community on its nuclear program, which meets the 
interests of the United States.
Attempts by the Obama administration to im-
prove the standing of relations with Iran may, how-
ever, provoke Iran’s regional rival—the Kingdom 
of Saudi Arabia—which in turn could lead to a se-
ries of outbreaks of Sunni extremism in the Central 
Asian region, not least directed and sponsored by the 
Saudis. Upon successful completion of current nego-
tiations of the International Group 5+1 with Iran on 
the nuclear issue, it is expected that Saudi Arabia is 
likely to experience a decline in its geopolitical and 
economic influence and weight in the Middle East 
and Central Asia, as well as in OPEC. In order to pre-
vent this, Saudi Arabia is seeking a strategic partner-
ship with the Gulf States and Israel. Presumably, the 
Saudis can also influence the situation in Afghanistan 
by inciting Sunni-Shiite strife. These new trends 
may potentially destabilize the already difficult sit-
uation in Central Asia and adversely affect Iranian-
Uzbek relations, given the fact that the population of 
Uzbekistan is largely composed of Sunnis.
At the same time, dissatisfaction with the policy 
on Iran of the Euro-Atlantic community and alleged 
“double standards” by the U.S. may once again force 
Iran, Russia, and China to seek a greater convergence 
of positions, notwithstanding competition among 
them.
Thus, there are two major challenges to cur-
rent Iranian-Uzbek relations: geopolitical tensions in 
Central Asia, which has forced Tashkent to seek an 
acceptable balance of forces in the region, and reli-
gious extremism, which is partly connected to the 
longstanding hostility between Iran and the United 
States. It is therefore obvious that prospects for bilat-
eral relations will be largely determined by the nature 
and degree of influence these two factors exert.
At the same time, Iran shares many common-
alities with Uzbekistan, and it is in the interests of 
economic and political security for Uzbekistan to 
gradually integrate itself into the Eurasian trading 
system. In December 2013, Tashkent ratified a Treaty 
of Accession to the free economic zone of the CIS 
13 “Uzbekistan sovmestno s UNP realizovyvaet 7 proektov,” 12uz.com, December 31, 2013, http://12uz.eom /#ru/new s/show / official/16033/.

Iranian-Uzbek Relations in the Geopolitical Context of Central Asia
161
countries, which expands the possibilities for eco-
nomic partnership with Iran.
It is also noteworthy that most of Iran’s partners 
are also partners of Uzbekistan. It is worth mention-
ing in this regard that Tehran is not limiting itself 
to close bilateral relations with Russia and China, 
but also seeks to join the multilateral structure of 
the SCO. On the other hand, Iran is working close-
ly with New Delhi, including cooperation on the 
TRACECA project which is favorable both to Central 
Asia and Europe. Moreover, Iran and another close 
neighbor of Uzbekistan, Afghanistan, have signed a 
strategic partnership and officially announced the 
launch of Afghan exports from the Iranian port of 
Chabahar.
14
 In parallel, Tehran is attempting to accel-
erate construction of the planned transport corridor 
Uzbekistan-Turkmenistan-Iran-Oman-Qatar and 
a pipeline from Iran to Pakistan. The improvement 
of Iran’s relations with Qatar
15
 has been helped to a 
certain degree by such economic considerations and 
security interests (read the Saudi factor). Further, 
economic interests encourage European countries 
(notably Germany, Poland, Sweden, and Italy) not to 
await resolution of the Iran-U.S. dispute but rather to 
revive lost links with Tehran.
16
Regardless of the position of the U.S. Congress 
on this issue, security and economic interests help to 
develop multilateral regional cooperation in Central 
Asia involving Iran. In order to consolidate these 
positive trends, Iran officially announced its refusal 
of violence in the Islamic world
17
 by reiterating that it 
has no links with international extremism. Moreover, 
it has stressed that Iran itself is a victim of drug traf-
ficking and is interested in a regional partnership to 
combat such.
Amid intensifying regional cooperation, the at-
tempts of Saudi Arabia to create an anti-Iranian bloc 
of Gulf States remain fruitless. Taking into account 
domestic political problems in Saudi Arabia, its eco-
nomic dependence on the United States, as well as 
Tehran’s efforts to approach the Saudis on finding a 
compromise in areas of common interest, it is pos-
sible that Saudi Arabia may yet come to a consensus 
with the Iranian leadership.
As for Israel, because of emerging pro-Iranian 
trends and the lack of a clear approach to Iran in the 
U.S., there has been a tendency of rapprochement to-
ward Russia
18
—one that could also pave the way for 
a possible gradual normalization of relations with 
Tehran.
conclusion
In sum, the evolution of Iranian-Uzbek relations and 
the dynamics of these relations to some extent affect 
regional processes in Central Asia as a whole. In par-
ticular, limited contacts between Iran and Uzbekistan 
(until 2005) led to an unstable geopolitical situation 
in the region while periods of cooperation (since 
2005) have served to reduce the negative impact of 
other complicating factors (U.S.-Iran dispute, etc.) 
through the implementation of economic projects. 
What is more, it is clear that without taking into ac-
count the interests of Uzbekistan and Iran and their 
active collaborative partnership, it is impossible to 
construct an effective mechanism for regional secu-
rity and cooperation. This is particularly important 
given the current situation in Afghanistan.
In turn, the intensity and degree of relations be-
tween Uzbekistan and Iran is also largely dependent 
on the barriers and obstacles imposed by the current 
geopolitical environment in Central Asia and the in-
dividual interests of these states. In the case of a sub-
stantial improvement in Iranian- American relations, 
Tashkent and Tehran could also significantly consol-
idate their relations by engaging in new large-scale 
energy projects (among others) in Central Asia.
14 “Afghanistan Has Officially Started Export of Goods by Chabakhar Port,” Afghanistan.ru, July 28, 2013, http://www.afghanistan.ru /doc/62773 
.html.
15 “Yuzhnyy Pars. Katar gotov sotrudnichat’ s Iranom v razrabotke mestorozhdeniya,” Iran.ru, December 25, 2013, http://www.iran.ru/news/eco-
nomics/91951/ Katar_gotov_sotrudnichat_s_Iranom_v_ razrabotke_mestorozhdeniya_Y uzhnyy_Pars.
16 “Germanskie kompanii gotovy investirovat’ v iranskuyu ekonomiku,” Iran.ru, December 24, 2013, http://www .iran.ru/new s/ economics/91946/
Germanskie_kompanii_ gotovy_investirovat_iranskuyu_ekonomiku; “Dva evropeyskikh ministra inostrannykh del posetyat Iran,” Iran.ru, 
December 27, 2013, http://www.iran.ru/news/politics/91997/Dva_evropeyskih_ministra_inostrannyh_del_ posetyatjran.
17 “Iranskiy ayatolla prizval shiitov i sunnitov ob”edinit’sya protiv terrorizma,” Iran.ru, January 3, 2014, http://www.iran.ru/news/ politics/92033/
Iranskiy_ayatolla_prizval_ shiitov_i_sunnitov_obedinitsya_protiv_ terrorizma.
18 I. Shamir, “O chem govorili Putin i Netan’yakhu - sensatsiya,” Komsomol’skaya pravda, December 28, 2013, http://www.iran.ru/news/poli-
tics/92002/0_chem_govorili_Putin_i_Netanyahu_sensaciya.

Guli Yuldasheva
162
However, if the negotiation process underway 
is delayed and confrontation with Iran prolonged, 
it cannot be ruled out that subversive activities and 
local conflicts with the participation and spon-
sorship of Saudi Arabia will take place. This sce-
nario is not in the interest of any party, including 
Washington or Riyadh. It is highly likely that a very 
gradual improvement of U.S.-Iran relations, albeit 
not without difficulties, will come to pass, where 
after a revival of Iranian-Uzbek relations in the 
emerging Eurasian Economic Community will be-
come more possible.

163
constraints and opportunities for Uzbek-Afghan Economic 
relations
Vladimir Paramonov and Alexey Strokov
1
 (2013)
In order to normalize the situation in Afghanistan 
and ensure long-term stability, coordinated interna-
tional action is needed in Afghanistan to restore the 
following: (1) the transportation network; (2) indus-
trial facilities; and (3) agriculture. This requires mobi-
lizing the economic potential, above all, of the coun-
tries neighboring Afghanistan, including Uzbekistan. 
It is precisely Uzbekistan that—given competent co-
ordination of international assistance—could play a 
decisive role in rehabilitating the northern provinces 
of Afghanistan, which are home to over two million 
ethnic Uzbeks (about 7 percent of the total popula-
tion of Afghanistan) and formerly contained at least 
two-thirds of the country’s industrial facilities.
The current State of Economic relations
From the birth of Uzbekistan as an independent state 
in 1991 up to 1998, when the Taliban took control 
of Mazar-i-Sharif, economic ties between Uzbekistan 
and Afghanistan remained insignificant, notwith-
standing the aid that Uzbekistan provided the north-
ern provinces before the Taliban regime established 
its control over them. During the period 1998-2001, 
when the Taliban controlled almost the entire territo-
ry of Afghanistan, Uzbek-Afghan economic ties were 
practically nonexistent. With the start of the interna-
tional anti-terrorist campaign in Afghanistan, how-
ever, Uzbekistan became one of the main forward 
bases in the fight against the Taliban. It is generally 
recognized that this played a key role in enabling the 
United States and its allies to consolidate their posi-
tions in Afghanistan.
After the “overthrow” of the Taliban regime, eco-
nomic relations between Afghanistan and Uzbekistan 
were gradually restored. This was greatly facilitated 
by the fact that the two countries share a border—
of about 137 kilometers—and that Uzbekistan has 
a developed transportation infrastructure that links 
with Afghanistan. In 2002 Uzbekistan opened the 
Khairaton Bridge on the Uzbek-Afghan border. In 
2003 the Airitom Customs Complex began to op-
erate in the border town of Termez, speeding up 
the process of registering and delivering freight to 
Afghanistan. Over the period 2002-3 alone, about 2.5 
million tons of freight were delivered to Afghanistan 
via Uzbekistan. In turn, Hamid Karzai’s government 
expressed willingness to develop economic interac-
tion with Uzbekistan, the matter coming under dis-
cussion during numerous visits to Tashkent by highly 
placed Afghan officials. In addition, Uzbekistan has 
participated in a number of projects to develop trans-
portation arteries in Afghanistan.
In spite of the above, Uzbek-Afghan economic 
relations remain at a low level, being confined mainly 
to small-scale trade that has a certain significance for 
Afghanistan (more precisely, for its northern prov-
inces), but which, as of yet, is of no great importance 
to Uzbekistan.
Uzbek-Afghan Trade
The volume of Uzbek-Afghan trade rose through-
out the period 2002-2010, with the exception of 
2005 when trade between the two countries dropped 
sharply largely due to difficulties in Uzbek- American 
relations. The volume of trade in 2011 was also some-
what lower than in 2010. According to data for 2011, 
Uzbek-Afghan trade accounts for under 3 percent of 
the foreign trade turnover of Uzbekistan and roughly 
6 percent of that of Afghanistan. This is far below its 
potential level (see Table 1 below).
The structure of Uzbek-Afghan trade (see Figure 
1) remained practically unchanged throughout the 
period 2002-2011. Uzbek deliveries to Afghanistan 
included fuel, electricity, and petrochemicals (60-62 
percent), ferrous metals and their products (20-24 
percent), food products consisting of flour, cereals, 
1 Co-founders of the web think-tank “Central Eurasia” (www.ceasia.ru), Tashkent. 

Vladimir Paramonov and Alexey Strokov
164
fruits, and vegetables (11-13 percent), and services 
(about 3 percent). Uzbek exports go predominantly 
to the northern provinces of Afghanistan, constitut-
ing either international humanitarian aid or are paid 
for from funds provided to Afghanistan by internati-
nal financial institutions.
Table 1. Trade between Uzbekistan and Afghanistan 
over the Period 2002-2011, in US$ Million
Year
Total Vol-
ume, US$ 
Million
Uzbek 
Exports to 
Afghani-
stan, US$ 
Million
Afghan 
Exports to 
Uzbekistan, 
US$ Mil-
lion
Export 
Balance in 
Favor of 
Uzbekistan, 
US$ Million
2002
61.5
61.3
0.2
+61.1
2003
89.6
89.4
0.2
+89.2
2004
130.1
126.2
3.9
+122.3
2005
19.3
19.2
0.1
+19.1
2006
163.7
161.7
2.0
+159.7
2007
332.3
331.4
0.9
+330.5
2008
533.1
530.5
2.6
+527.9
2009
703.9
703.8
0.1
+703.7
2010
663.5
663.3
0.2
+663.1
2011
456.3
456.1
0.2
+459.9
Source: Economist Intelligence Unit
2
Volumes of Afghan exports to Uzbekistan were 
insignificant throughout the period 2002-2011 and 
remain minor today. Except for the years 2004, 2006, 
and 2008, when their value was in the range of $2-4 
million, the value of exports from Afghanistan was 
at an extremely low level. Moreover, they were made 
up almost entirely of services (about 99 percent). 
Deliveries of goods are very modest and consist of 
certain kinds of agricultural raw materials such as ed-
ible fruits and nuts.
This distinct lack of exports from Afghanistan 
to Uzbekistan is not surprising considering that the 
real sector of the Afghan economy (its industrial and 
agro-industrial segments) was practically destroyed
while the population of Afghanistan survives mostly 
on account of the subsistence economy and by culti-
vating opium poppy. As a result, the scale of Afghan-
Uzbek trade is determined mainly by the magnitude 
of international financial assistance to Afghanistan: 
it is primarily with foreign money that Afghanistan 
buys industrial and consumer goods in Uzbekistan.
Figure 1. Structure of Commodity Deliveries from 
Uzbekistan to Afghanistan (2011)
Source: Figure utilizes data from the Economist Intelligence Unit
Projects with Uzbek Participation
The economic projects carried out in Afghanistan 
with Uzbek participation are mainly concerned with 
the restoration or building of transportation arter-
ies. These projects are financed by international in-
stitutions on account of Uzbekistan being unable 
on its own to make investments of any significance 
in Afghanistan. Nevertheless, the contribution that 
Uzbekistan makes to the process of reconstruction in 
Afghanistan may be considered significant: the proj-
ects in which Uzbekistan participates are important 
to Afghanistan.
After the overthrow of the Taliban and the acces-
sion to power of the Karzai government, Uzbekistan 
participated very actively in restoring the motor road 
between Mazar-i-Sharif and Kabul. Between 2003 
and 2011, Uzbek specialists restored and reopened 
eleven bridges along this route. Another major proj-
ect in Afghanistan has been the construction of the 
rail branch line from Khairaton to Mazar-i-Sharif 
(75 kilometers). This project was carried out during 
the period 2009- 2011 on the basis of an agreement 
concluded in 2009 between the State Joint-Stock 
Railway Company (SJRC) Uzbekiston Temir Yullari 
(the operator of the project) and the government of 
Afghanistan. The project itself included the laying of 
the railway line and the building of a freight terminal 
and accompanying infrastructure in Mazar-i-Sharif.
The total funds allocated to the project were 
about $180 million, of which $165 million was a grant 
from the Asian Development Bank and $15 million 
came from the government of Afghanistan. The line 
came into operation at the end of 2011. The volume 
2 Economist Intelligence Unit (“Uzbekistan: Country Report,” The Economist Intelligence Unit, London, June 2003, June 2004, June 2005, June 2006, 
June 2007, June 2008, June 2009, June 2010, June 2011, March 2012).

Constraints and Opportunities for Uzbek-Afghan Economic Relations

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